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Infographic showing the various factors that influence property valuations for tax purposes in Melbourne.

What Factors Determine Your Property’s Value for Tax in Melbourne?

When reviewing your property’s valuation for council rates and land tax in Melbourne, it helps to understand what key factors impact the assessment. The Valuer-General Victoria (VGV) considers various attributes when determining the value of a property.

Land-Related Factors

  • Land size – Larger blocks generally attract higher site value.
  • Location – Premium suburbs and proximity to amenities impact values positively.
  • Accessibility – Easy access to public transport, highways etc. improve valuations.
  • Zoning – Commercial or mixed use zoning leads to higher site value.
  • Development potential – Land suitable for further development has higher inherent value.

Improvements-Related Factors

  • Property age and condition – Newer properties in good condition mostly achieve higher valuations.
  • Home size – Total floor area, number of bedrooms etc. impact the improved capital value.
  • Special features – Pools, tennis courts and other features add value.
  • Renovations/additions – Extensions, kitchen upgrades etc. can enhance value.
  • Outbuildings – Sheds, studios, car ports etc. increase the overall improved value.

Market-Related Factors

  • Recent sales – Comparable sales help establish benchmark rates for an area.
  • Buyer demand – High demand in a suburb pushes up valuations.
  • Supply – More inventory brings valuations down.
  • Interest rates – Lower interest rates stimulate demand and prices.
  • Economic trends – Strength or weakness in the economy impacts the property market.

Ensure Accuracy

Check your valuation notice to ensure the VGV has correctly factored the applicable attributes of your property, both land and improvements. Errors could lead to an unfairly high or low valuation.